Supreme Court Rules Against Aereo TV

The Supreme Court has ruled for broadcasters and against Aereo TV in the battle over Aereo's tiny antennas which allow people to watch live TV broadcasts over the Internet. The opinion is here. (Background is here.)

The Court today ruled (with Justices Alito, Scalia and Thomas dissenting) that Aereo's service is one that transmits performances of copyrighted works to the public. It rejected Aereo's arguments that it merely supplies equipment that allows others to do so. [More...]

Aereo is not simply an equipment provider. Aereo sells a service that allows subscribers to watch television programs, many of which are copyrighted, virtually as they are being broadcast. Aereo uses its own equipment, housed in a centralized warehouse, outside of its users’ homes. By means of its technology, Aereo’s system “receive[s] programs that have been released to the public and carr[ies] them by private channels to additional viewers.”

The Court agreed with broadcasters that Aereo's service violated the "transmit" clause of the amendments to the 1976 Copyright Law.

The Act now clarifies that to “perform” an audiovisual work means “to show its images in any sequence or to make the sounds accompanying it audible.”§101. Thus, both the broadcaster and the viewer “perform,” because they both show a television program’s images and make audible theprogram’s sounds.

...Congress further created a complex licensing scheme that setsout the conditions, including the payment of compulsory fees, under which cable systems may retransmit broadcasts to the public. §111.Congress made all three of these changes to bring cable system activities within the Copyright Act’s scope.

The Court rejected Aereo's arguments that the role of the individual user of its service distinguishes it from the CATV systems that Congress sought to regulate. The Supreme Court didn't buy it.

Aereo claims that because it transmits from user-specific copies, using individually-assigned antennas, and because each transmission is available to only one subscriber, itdoes not transmit a performance “to the public.” Viewed in terms of Congress’ regulatory objectives, these behind-the-scenes technological differences do not distinguish Aereo’s system from cable systems, which do perform publicly. Congress would as much have intended to protect a copyright holder from the unlicensed activities of Aereo as from those of cable companies.

...[T]he subscribers to whom Aereo transmits constitute “the public” under the Act.... In addition, neither the record nor Aereo suggests that Aereo’s subscribers receive performances in their capacities as owners or possessors of the underlying works.... Finally, the statute makes clear that the fact that Aereo’s subscribers may receive the same programs at different times and locations is of no consequence. Aereo transmits a performance of petitioners’ works “to the public.”

Aereo told the Court during oral arguments:

You know you have a right to put an antenna on your roof and put a DVR in your living room. We can provide exactly the same antenna and DVR for a fraction of cost by putting it over the cloud.

The Court said it doesn't think it's ruling will be of significant impact.

We agree that Congress, while intending the Transmit Clause to apply broadly to cable companies and their equivalents, did not intend to discourage or to control the emergence or use of different kinds of technologies. But we do not believe that our limited holding today will have that effect.

we used 5 Ghz antennas very similar to these to beam live camera images from the top of Mt. Everest down to base camp, on down to Kathmandu, and up to satellites, and finally down to NYC and Ted Koppel live. I was at base camp at 19,000 ft. to film the climbers going to the top with stripped down Panasonic video cameras. The tiny antennas worked very well.

Let us suppose that here in Gothamopolis there are 4 television stations.

FOX is on channel 2, CBS is on channel 3, ABC is on channel 4, and NBC is on channel 5.

Let us suppose that Aereo operates in Gothamopolis.

With the just handed down ruling, the only way Aereo can receive broadcasts on behalf of subscribers and pass them along to the subscribers is if the stations get paid, just like with cable.

Except, unlike with cable, the Aereo subscriber tells Aereo to which channel(s) to tune.

Which means Aereo can keep a record of those choices.

Which means that if I, here in Gothamopolis, watch channels 2, 3, and 5, via Aereo, but never watch channel 4, there is no justification whatsoever for any of my money to ever be passed along to channel 4.

Further, channels 2, 3, and 5 only get paid for what I actually watch of their offerings.

Presto, a la carte.

Which means cable and satellite viewers start asking "Hey, how come I'm having to pay for all this stuff I don't want and never watch?".